I'm 23 years old/1 year in consulting. Came from low-income household so wasn't really well educated in managing money. I have about 40k (spread throughout cash, stocks/etfs, and 401k) saved up from one year of working but I'm not sure what to do with the money. It's not a lot but I want to build a foundation where I can grow my money efficiently in my 20s. I heard about HYSAs and CDs but not sure what direction I should go to grow wealth.

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First off, congrats on saving that amount at your age. Most people don’t even have that saved at mine - I’m 9 years your senior.

A few things I would do:

- Open up a Roth IRA (I think that’s what the comment above was as well). If you contribute to a 401K, you can put up to $6,000 in a Roth a year tax free (I believe that’s the terms but someone please correct me if I’m wrong). Invest in more ETFs - vanguard ones are good (like previous comment).
- Buy I-bonds - you can get the 9.6% interest rate until October. You can purchase up to 10K per year. It’s essentially free money but keep it in for at least a year to make sure you’re getting the profit.
- Open a high-yield savings account. Especially with the market the way it is, it’s smart to have a good chunk of money immediately available that’s not invested, but you want that to grow too and not sit in a regular savings with poor interest. Marcus by Goldman has a great rate of 1.7% APY (which will likely increase with the next fed hike) and allows you to refer up to 5 people and get an additional 1% for 3 months. So right now with the one referral I’m getting 2.7%.

Those are some immediate, smart and long-term directed things you can do. You’ll be well positioned by the time you hit your 30s. Be proud of what you’ve accomplished - it’s not easy to achieve financial literacy when you didn’t have it growing up.

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Saving this comment, thanks MM1

Here you go. This needs to be updated for this year’s maximums. I would also add HSA after blue 401k box if you’re on high deductible plan.

In terms of what to invest into… low cost index funds following SP500. Simply Google for your broker and you will get that list. You don’t need anything else and no advisor until you hit multiple millions.

Individual stocks are for playing. Once you max everything on this page, you can allocate a small portion of your cash to play with.

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Open a fidelity account and invest it in VTI.

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Invest in your financial literacy so you don’t take random advice and take control and responsibility of your decisions. It’s your life.

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